Nissan, Renault not ready to discuss new capital ties: Saikawa

TOKYO (Reuters) - Nissan CEO Hirota Saikawa said on Monday that he had not heard directly about a reported French proposal to integrate the Japanese carmaker’s management with Renault, adding that it was not the time to discuss revising the partners’ capital ties.

FILE PHOTO: Nissan President and Chief Executive Officer Hiroto Saikawa attends a news conference after Japanese media reported that Nissan Chairman Carlos Ghosn will be arrested on suspicion of under-reporting his salary, at the company headquarters in Yokohama, south of Tokyo, Japan November 19, 2018. REUTERS/Issei Kato/File Photo

The Nikkei newspaper reported on Sunday that a French government delegation had informed Tokyo that it would seek an integration of Renault SA and Nissan, most likely under the umbrella of a single holding company.

“Since I have not heard this directly, I cannot comment,” Saikawa told reporters.

Asked about future capital ties, he said: “We are not at the stage for such discussions.”

Japanese public broadcaster NHK quoted French Economy Minister Bruno Le Maire as telling journalists that an integration proposal was “not on the table now”.

The fresh reports of closer integration come as ousted Nissan Chairman Carlos Ghosn remains in detention following his Nov. 19 arrest and subsequent charges of financial misconduct, which he has denied.

Ghosn, under pressure from the French government, had pushed for a deeper tie-up between the two carmakers, including possibly a full merger, despite strong reservations at Nissan.

A source familiar with Nissan’s thinking said the reported French proposal did not “make sense” given the two companies’ different cultures, Renault’s lower productivity and Nissan’s bigger contribution of key technology.

“It’s a virtual merger, I don’t think it makes sense,” the source said, adding he had not heard directly of such a French proposal.

Ghosn has asked a Tokyo District Court again to grant him bail after a request last week was denied, citing flight risk and concerns about evidence tampering.

A decision is expected on Monday.

Ghosn has offered to post stock he owns in the automaker as collateral, surrender his passports and submit to electronic tracking as part of a renewed effort to persuade a Tokyo court to grant him bail while he awaits trial on charges of financial misconduct, a spokeswoman for the car executive said. Any bail must be paid in cash.

Ghosn spearheaded Nissan’s turnaround two decades ago, and his arrest has jolted the auto industry, while muddying the outlook for Nissan’s three-way alliance with Renault and Mitsubishi Motors Corp.

Renault, which dominates the partnership through its 43.4 percent stake in Nissan, is expected to meet within days to consider potential candidates to replace Ghosn as chief executive officer and chairman.

The co-chair of a committee set up by Nissan to examine the root cause of Ghosn’s alleged financial misconduct and propose corporate governance reforms said on Sunday he believed Ghosn may have had questionable ethical standards.

“Having read the report on the internal investigation, my initial impression was that the head of the company may have had questionable ethical standards,” committee co-chair Seiichiro Nishioka told a briefing late on Sunday after the panel held its first meeting.